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Texas Business Organizations Code - BUS ORG § 101.455. Stay of Proceeding

Current as of January 01, 2024 | Updated by Findlaw Staff

(a) If the limited liability company that is the subject of a derivative proceeding commences an inquiry into the allegations made in a demand or petition and the person or group of persons described by Section 101.454 is conducting an active review of the allegations in good faith, the court shall stay a derivative proceeding for not more than 60 days until the review is completed and a determination is made by the person or group regarding what further action, if any, should be taken.

(b) To obtain a stay, the limited liability company must provide the court with a written statement agreeing to advise the court and the member making the demand of the determination promptly on the completion of the review of the matter.

(c) A stay, on motion, may be reviewed every 60 days for continuation of the stay if the limited liability company provides the court and the member with a written statement of the status of the review and the reasons why an extension for a period not to exceed 60 additional days is appropriate. An extension shall be granted for a period not to exceed 60 days if the court determines that the continuation is appropriate in the interests of the limited liability company.

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Cite this article: FindLaw.com - Texas Business Organizations Code - BUS ORG § 101.455. Stay of Proceeding - last updated January 01, 2024 | https://codes.findlaw.com/tx/business-organizations-code/bus-org-sect-101-455/

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